General Election 2019 – Promises, Policies and Pledges impact on the Property Market
Housing policy forms a significant part of the political parties’ manifestos for the upcoming General Election taking place on 12 December 2019.
The property market could see some big changes depending on the results of the General Election and this would affect tenants of rental properties, first-time buyers, those looking to move up the property ladder, property investors and businesses.
Below, we consider the specific promises, policies and pledges which will have an impact on the housing and property sector.
The Conservatives pledge to build at least one million more homes within the next five years to help first-time buyers and boost private house building and confirm a commitment to ensure that new GP and school places are available ahead of people moving into new build housing. They intend to extend the Help to Buy Scheme from 2021 to 2023 and maintain the Right to Buy scheme which enables social tenants to build up an equity. The Conservatives encourage long-term and lifetime fixed rate mortgages, to be available with a 5% deposit. This would mean mortgage payments would remain consistent and allow people to get onto the property ladder. They pledge to abolish no fault (Section 21) evictions which currently allow Landlord’s to evict renters without a reason after their fixed-term tenancy period ends. Introduction of an increase in Stamp Duty for non-UK resident buyers, including Companies. They intend to allow Local Authorities to increase Council Tax by up to 500% where homes are left empty for more than six months. They pledge to simplify shared ownership schemes by setting a single standard for all housing associations.
Labour pledge to build 150,000 new social homes a year within five years, 100,000 of which are to be built by Councils.
Labour intends to introduce a phased increase in Corporation Tax to 32% which may put many small businesses and private investors under pressure. They also pledge to charge foreign companies and trusts extra tax when buying property in the UK. Labour wish to abolish to Right to Buy scheme, and give new powers and funding for councils to buy back former council houses from private landlords. Labour state that £1 billion a year will be provided for council homelessness services and extra shelters and that they will build 8,000 homes for people with a history of rough sleeping, with a pledge to end rough sleeping in five years. They promise to scrap Universal Credit, the Bedroom Tax and Benefit Cap, while increasing Local Housing Allowance rates. Labour will introduce rent controls as well as introducing ‘open-ended’ tenancies rather than fixed-term tenancies, to give renters greater security and certainty. The Help to Buy scheme would be reformed.
The Liberal Democrats focus includes plans to help young people with their tenancy deposits by establishing a Help to Rent Scheme. This would provide a government-backed tenancy deposit loan for all first-time renters under 30. They pledge to ensure total housebuilding reaches 300,000 a year by 2024, with 100,000 social rented houses. They intend to allow Local Authorities to increase Council Tax by up to 500% for second homes and introduce a Stamp Duty surcharge on overseas residents purchasing second homes in the UK. Liberal Democrats will improve protection against for tenants with mandatory licensing and promote longer tenancies of three years or more with inflation linked annual rent increases.
It is clear that the Property market will see some significant changes depending on which way the General Election goes and that there is a focus on increasing housebuilding, making the market more accessible for first time buyers and those looking to move up the property ladder and making the market fairer for tenants.